Bad debts of £70,000 racked up by a benefits cheat and a storage firm boss who refused to pay rates will be written off by the council.

Attempts to recover the money through the courts failed after both men involved disappeared from the borough. The owner of a Wokingham storage company who vanished owing almost £40,000 in business rates is thought to have moved to the Dale Farm travellers’ site in Essex.

While the welfare cheat moved to Australia from his rented house in Millbank Crescent, Woodley, after he admitted fraudulently claiming £28,645 in housing benefit.

The decision to write off the debts was made by Anthony Pollock, executive member for finance, on Friday March 22. In both cases, Wokingham Borough Council officers reported that they had exhausted all steps to get the money back. Cllr Pollock said: “We have a policy, like The Mounties, of never letting go. We will spend up to seven years trying to collect the money and it is only in extremis that we write any off.”

The report reveals the owner of the storage business at Warren House Road in Wokingham failed to pay rates between 2006 and 2012, despite receiving reminders, court summonses and a visit from bailiffs.

In January 2012 the council was told the man had moved to Dale Farm, described in the report as “a well-known travellers’ camp”.

The council asked Basildon Borough Council, which administers the site, for help but they were unable to find the man.

The housing benefit cheat was investigated after officers discovered he had a job, earning a minimum of £500 a week, following an anonymous tip-off about his ‘lavish lifestyle’ funded by state benefits claimed by him and his family.

He admitted the fraud between September 2008 and November 2011 under caution but before he could be prosecuted he moved to Australia.

An arrest warrant was issued, the Australian High Commission was informed and if the man returns to the UK he will be held.

The report states that neither debt will have a financial impact on Wokingham Borough Council as the business rates debt of £39,719.44, less £1,010 court costs, would have been payable to the Government.

The borough receives a 100 per cent subsidy for housing benefit, but only 40 per cent where housing benefit is overpaid, leaving the council to recover at least 60 per cent so the debt is cost neutral.

The 40 per cent subsidy coupled with the successful collection of other overpayments mitigated the loss.